https://prezi.com/rvqj7a8tebjp/scaling-agile-with-holacracy/
Given the recent news at Zappos, who uses Holacracy, I was prompted about that quote from Tony Hsieh, their CEO. Here’s my answer.

First I tend to be careful with quotes that are taken out of context. Words in the media are sometimes over simplified, and excerpts only taken to make a point chosen by the journalist. I would argue the same when reading “no-manager” or “flat structure”. In the details it’s always more subtil and sometimes we still have to invent the right words for new concepts.

If Tony Hsieh really only said that and implemented the lay-off of employees by announcing them that they were fired because they don’t fit the company culture, then he’s completely wrong about Holacracy and teal organizations. Here’s why: in such organizations, decisions can’t be taken that way. He has no right to do so, even if he’s the CEO, and I would insist, especially if he’s the CEO.

I don’t know the exact details of how this was implemented, but in a teal organization, options would have been given and each employee would be offered the possibility to make a conscious choice. Teal organizations, with Holacracy being one way of implementing them, are about putting more consciousness in the organization.

Back at home, I did a bit of research on that quote, ant it turns out that this quote dated from 2012, before Zappos started its transition to Holacracy in 2013. At that point in time, it is probable that Zappos was pretty much still in the green paradigm (“We are a family” with a great culture) and the “father” being the CEO could still make those kind of decision.

In any case, the recent lay-offs at Zappos, if done correctly are a valid way to transition to teal. It’s not the only way. Self-management doesn’t happen out of nothing, the important thing is that there is consciousness in how it is done.